What is Transmission of Shares? How to Claim Shares After Death
Transmission of shares is the legal process of transferring shares from a deceased person's demat account to their legal heir or nominee. Unlike a regular transfer which happens because someone sold shares, transmission happens because the original holder has passed away and the securities need to move to the rightful successor.
When a family member who held shares passes away, those shares do not automatically disappear or become available to the family. They remain in the deceased person's demat account until a formal transmission request is submitted and processed by the depository participant.
How Does Transmission Work if There is a Nominee?
If the deceased had registered a nominee on the demat account, the process is relatively straightforward. The nominee submits the death certificate, their own identity documents, and a transmission request form to the DP. The DP verifies the documents and transfers the holdings to the nominee's demat account. This typically takes 7 to 15 working days.
How Does Transmission Work Without a Nominee?
Without a nominee, the legal heirs must obtain a succession certificate from a court or submit a probate of will if a will exists. This legal process can take months or even years. Once the succession certificate or probate is obtained, the heirs submit it to the DP along with other required documents for the transmission to be processed.
This is exactly why SEBI has made nomination mandatory for all demat accounts. Having a nominee avoids the court process entirely.
Investments in securities market are subject to market risks. This article is for educational purposes only.
Frequently Asked Questions
What documents are needed for transmission to a nominee?
Typically you need: the original death certificate, the nominee's identity proof (PAN, Aadhaar), a transmission request form from the DP, an indemnity bond in some cases, and the nominee's demat account details where the shares should be credited.
Is transmission the same as inheritance?
Transmission is the operational process of moving shares. Inheritance is the legal right to receive assets. The nominee receives the shares through transmission but holds them in trust for the legal heirs as per succession law. If there is a dispute among heirs, the legal process determines final ownership.
Are there charges for transmission?
Most DPs do not charge for transmission of shares. The process is typically free as a service to the deceased investor's family. However, some DPs may charge nominal administrative fees.
Can transmission happen between two living people?
No. Transmission specifically refers to the transfer of shares from a deceased person's account. Transfer of shares between living people is called an off-market transfer or sale through the exchange, not transmission.
How long does the entire transmission process take?
With a nominee in place, 7 to 15 working days after all documents are submitted. Without a nominee, the court process alone can take 6 months to several years, followed by the DP's processing time. This stark difference is why having a nominee is so important.
Investments in securities market are subject to market risks. This article is for educational purposes only and does not constitute investment advice.
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